Thailand OIC - Amending Health Insurance Law

The Office of Insurance Commission (OIC) will propose a new law overseeing health insurers in light of rapidly growing health concerns surrounding the pandemic. The health insurance law is being studied by Chulalongkorn University and is expected to be drafted and proposed to related parties this year. The law will regulate voluntary-based health protection insurance.

OIC secretary-general said health insurance grew 7% in the first half while life insurance shrank 3.3%, driven by raised health protection awareness caused by Covid-19 and the higher expenses of health and medicine. Health protection is a high-growth product. Thailand should have a mechanism to shape the future to grow in the right direction like in many countries.

Focusing on protection products can also help insurers survive under low-interest rates. Many new international standards require capital reserves based on risk and long-term obligations such as endowment and products that guarantee a return rate.

Today, non-life insurers can sell critical illness protection as a standalone product, while life insurers are required to include a major life insurance policy in the package. Therefore, the overall premium value is typically expensive relative to the standalone.

The difference is due to the law stating that life insurance is based on the "viability of the insured".